Hotels/Restaurants/Casinos

McDonald’s reports flat quarterly earnings

BenFox Rubin

NEW YORK — McDonald’s said its fourth-quarter profit was nearly flat, as the fast-food giant’s global same-restaurant sales edged down 0.1% and expenses rose.

McDonald’s
MCD, +0.48%
reported a profit of $1.397 billion, up from $1.396 billion a year earlier. Per-share earnings rose to $1.40 from $1.38, due in part to fewer shares outstanding in the latest period. Revenue grew 2% to $7.09 billion.

Analysts polled by Thomson Reuters forecast earnings of $1.39 a share on revenue of $7.11 billion.

For over a year, McDonald’s has struggled to address external and internal challenges that have weakened its business. The soft global economy has caused consumers to rein in restaurant spending, and the chain has made some mistakes in how it has addressed that uncertainty. For example, McDonald’s limited-time promotion of chicken wings was priced at $1 per wing, well above some competitors’ prices.

Previously, Mr. Thompson said the chain noticed a “bifurcation” of customers, with lower-income customers struggling to afford restaurant meals, while higher-income people are willing to spend more for food. He has said McDonald’s is trying to strike the right balance between the two.

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